The first thing I noticed this morning at my newsagent in Melbourne’s leafy eastern suburbs is that the pile of Herald-Suns is twice as high as the pile of The Age. So the first comparison is easy.

Even in this relatively affluent suburb, the newsagent expects to sell more Herald-Suns than copies of The Age.

The second comparison is also easy and perhaps explains the first: the Herald-Sun is $1.20 and The Age is $2.00. Price-conscious newspaper buyers will probably prefer the cheaper product.

The canny Herald-Sun buyer also gets more bang for their buck-twenty. The Murdoch ‘tabloid’ has 80 pages and the Fairfax Media ‘compact’ has 72, plus a 16 page insert that is numbered differently.

But how do you tell a tabloid from a compact? It’s not that easy because technically they are the same size: 30X40 centimetres.

Perhaps it’s in the layout and use of colour on the front page.

The Age has retained its signature royal blue, but the masthead is superimposed reverse in white on blue. The Herald-Sun uses a verdant green and a superimpose/reverse white, but it’s masthead block is deeper coming 14 centimetres down the page. The Age masthead is a shallow nine centimetres.

The Herald-Sun also uses its masthead to promote a “Superstar Footy DVD” give-away and incorporates action pics of two AFL stars who I don’t recognize, but who I’m sure would be very familiar to Aussie Rules fans.

As you would expect the Herald-Sun has a brighter more ‘tabloid’ front page with a bold headline in four centimeter solid capital letters: “SECRET TAPES BOMBSHELL” . Over the top of that is a white-on-red banner also in heavy caps: “POLICE CRISIS ROCKS GOVERNMENT”. Just below the headline is a series of three ‘pointers’ also in block caps: “KEY STAFFER PAID $22,500”; “JOB HELP AT ODDS WITH PREMIER”; “BAILLIEU ADVISTER SLAMS DEJPUTY PREMIER”.

The kicker is that readers are invited to “Now listen to the recordings heraldsun.com.au”

The copy itself, across five columns is about 350 words and the story is continued across four pages (4-7) inside.

At the bottom of the page there’s three ‘skybox’ promos for contents inside the paper. This is a great tabloid front page and if you were buying the paper on its shelf-appeal, you would probably go for The Herald-Sun.

Telecommunications giant Optus managed to convince the Federal Court in Sydney this week that there’s a legal blindspot in relation to its download pay-per-view service.

Telstra – given its business relationship with The National Rugby League (NRL) and Australian Football League (NFL) – had tried to prevent Optus from recording and re-broadcasting matches screened on free-to-air television.

But Justice Steven Rares found Optus’s mobile television service didn’t breach the Copyright Act for a couple of reasons: Optus keeps separate recordings for each customer, and individual customers are responsible for requesting the recordings.

So what’s going on here?

To my mind, former rugby league coach Roy Masters – ever the shrewd observer – hit the nail on the head when he wrote the following for the Sydney Morning Herald yesterday:

“They framed the copyright laws to protect the average punter from being sued for taping a TV show, including a football match on his home recorder. Now, their legislation is being used by Optus to sell a service.”

Naturally, Telstra has concerns. The AFL’s A$1.25 billion five-year rights deal signed last season with Channel Seven, Foxtel and Telstra, included a A$153m payment by Telstra for the online broadcast rights to games. The NRL, likewise, expected a proportion of its next deal to come from internet rights.

There’s been some excitement on the bourse and in media boardrooms this week over Gina Rinehart’s move on Fairfax Media. It seems the West Australian iron ore magnate is angling for a seat on the Fairfax board to add to her $165 million berth at the Ten Network.

Rinehart is keen to take her original 4 per cent stake of Fairfax to about 15 per cent. She bought the first shares for $100 million and is likely to spend close to $200 million on this raid.

But what are the real implications in this venture?

There’s been speculation that the Communications Minister, Senator Stephen Conroy, might move to block Rinehart’s attempted takeover of Fairfax – if indeed that’s what it is. The grounds for such a move would perhaps be that she’s not a fit and proper person to own media assets because of her alleged political bias. Rinehart is a vocal opponent of the Labor government and its resource rent tax scheme. The timing of Rinehart’s grab has created talk about the blocking move by Canberra. She’s made the play as the final report of the Convergence Review on media and communications is due to be handed down, and in the knowledge that the current convoluted and unworkable media ownership rules will be changing.

Blocking any takeover is open to the regulators under provisions of the Trade Practices Act dealing with matters of public interest. A strong case would have to be made that Rinehart’s control would lessen media competition. There is no “media” law that prevents her actions now and even less under the proposed new regulator.

But, for me, the timing is coincidental. Rinehart is buying Fairfax shares under the existing rules, which limit audience share across platforms and across markets. She is therefore entitled to increase her stake in Fairfax – while holding significant shares in Ten – as long as she does not control the companies and her combined media assets do not constitute a breach of the “three-and-two” rule (where companies are allowed to own up to two media outlets — TV, radio and newspaper — in a single area).

There’s also the issue of the government’s legislative and political timetables to consider. Filling in the substantial missing detail in the Convergence Review’s recommendations is going to take months, if not years. The timeline could stretch well beyond the next election cycle. We will be playing by the old rules for a while yet.

Rinehart’s decision to move now can be explained without recourse to conspiracy theories or invoking the “evil witch of the West” stereotype. She is cashed up; the Fairfax share price is ridiculously low (down from about $5 five years ago to less than 90 cents today) and by taking a chunk of stock she gains leverage over the company at a time when it needs to transition from being primarily about ink on paper to being truly converged and multimedia.

Rinehart may well be thinking long-term and looking for business synergies, cost-savings and profit-taking by joining up her investments in Ten and Fairfax. She would effectively then be able to either harmonise these business units to create a going concern, or sell-off strategic assets once the new ownership rules and content regulations are in place.

Whatever her motives, Gina Rinehart still has to play by the rules. She cannot easily move to positions of control of both Ten and Fairfax Media under the current cross-media ownership regulations without a fight. Under the mooted new rules she would also have to pass the public interest test.

Having said that, I don’t think it is useful to demonise Rinehart and suggest that she has an ulterior personal and political motivation for taking on Fairfax. She has strong and very conservative political views and she has been spending some of her inherited mining wealth on anti-government campaigns in recent months, but I am not sure that Gina Rinehart is another Kerry Packer or Rupert Murdoch waiting in the wings.

Rinehart is incredibly rich and she has seen an opportunity to buy a media asset while it is at or close to the bottom of its share price cycle.

What we should be concerned about is that this share market play makes a mockery of the idea that the news media and the press are somehow bastions of free speech and freedom of expression.

According to her own family, Rinehart is a tough woman and as hard as the ore her father dug out of the Pilbara to create her vast fortune.

She will have to be resolute if she is to take on Fairfax journalists who have fiercely defended their independence in the face of perceived corporate interference. Readers of Fairfax publications may also not take too kindly to Rinehart’s editorial line.

Her solution might be, as some have suggested, to wrestle control of the major Fairfax dailies and leave the rump to be sorted by the board. This scenario rests on Rinehart’s motivation being influence rather than profit.

Rinehart’s multimillion-dollar raid on the Fairfax share cupboard just goes to show that the adage “freedom of the press belongs to those who can afford to buy one”, still applies in convergent Australia.

Rinehart’s estimated wealth is staggering – she’s rumoured to be one of the richest people on the planet – so she can easily afford to buy Fairfax and whatever she damn well wants, but there are many hurdles to jump before she can claim the throne as Australia’s princess of print.

The substantive text in this piece was published on 10 November 2011 on The Conversation. It was my first commission from them and I appreciate their creative commons approach to republishing. Eager readers will also know that I was involved in the Australian government’s media inquiry this week.

A transcript of my comments is apparently going to be made available, I will post it to EM when I can. I read through it yesterday to proof-read it. I think I did OK; but others will judge that. Speaking of which…

I have been attacked by the Daily Telegraphtwice and The Australian (several times) for being a Trotskyist, which they “revealed” (ha ha)and some how managed to make sound like I am deranged. How come they never attack libertarians for their views…and they are deranged!

I also made my cherry-busting appearance on Andrew Bolt’s blog. I did seek a right-of-reply by posting comments online to both places; but as of 6.18pm today, they have not been taken out of moderation. Unlike the 50-odd comments calling for me to be burned as a witch or sacked from my job.This is an interesting observation about the free speech fundamentalists. They bleat and moan and scream and shout about their own “rights” and then vilify those who dare critique them. But they will not extend common courtesy to their opponents.

In fact, there is no right of reply at News Limited as this lovely little ‘thank you notice’ makes very clear.

Contrast this with the pumelling I received on an anonymous blog, Bunyipitude written by someone who I only know as ‘the professor’ – it’s what he calls her/himself – after coming after me with both barrels he/she at least had the decency to post my response. The comment stream hasn’t been very complimentary, but I can take it. My only concern is that most posters there hide behind anonymity. It makes the whole experience surreal. They know who I am and can comb the interwebs for what they see as damning evidence of my perfidity, but I don’t know who they are. Then they get up set when I suggest they might be trolls.

On the other side of the ledger, I am grateful to News with nipples for a spirited defence of sanity. I note too that the author, Kim Powell is happy to identify herself. In fact she seems quite nice and I’d like to meet her. She is doing a PhD on online newsrooms so we’d have stuff to talk about.

Anyway, all I can say to my haters and detractors is: “The Devil made me do it.”

The Guardian is somewhat cheerily reporting this week that its arch-rival for British eyeballs, Murdoch’s The Times has suffered what appears to be a catastrophic drop in site traffic since ducking behind the paywall last month.

According to the Guardian‘s analysis (which you might discount on grounds of competitive one-upmanship) traffic to the Times website has fallen as much as 90 per cent since the 15th of June this year.

The results also seem to confirm my analysis – soon to be published in News 2.0: Can journalism survive the Internet? – that the revenue streams from online subscriptions and daily paid visits are going to be a drop in the bucket compared to newspaper publishers’ overall income generating capacity:

There are approximately 150,000 Times print subscribers who get a free online registration, but if the estimated 15,000 daily online users who agreed to pay opt for the £2 a week deal, the paywall will generate £120,000 a month – £1.4m a year.

That £1.4m a year is not going to cover the wages bill, let alone all the associated costs. It certainly is not a positive income stream.

I know that some commentators are suggesting that Rupert’slostthe plot – he is nearly 80 – and that the Internet has overtaken his usually sharp business brain because of its lightening speed; but I’m not so sure.

To me this indicates a deeper game plan and a multiple strategy play that is yet to completely unfold. I’m not suggesting that Murdoch is going to be the ultimate winner here, but he is hedging his bets.

News International is also working on other aspects of the exclusivity of brand that the paywall might suggest. If you sign up and pay your 50 quid you get access to deals on executive travel, wine, books, etc. All aimed at the wealthier and older end of the scale. I’m shaking my head as I write this because not only is this approach nothing to do with the quality of the news on offer; but it also seems like a sinking lid strategy.

An older audience eventually gets smaller – it’s just the attrition of age and infirmity really. At the same time there’s nothing in the data to suggest that newspapers are generating interest in a younger audience – there is no long tail in this strategy.

The other clear observation is that no one has yet cracked the Holy Grail of the new business model for newspapers. It is obvious that in the short to medium term erecting a paywall means you take a hit; but it’s too soon to tell if there will be gains in the long run.

For readers, grazers and news surfers it means one less outlet, but in the crowded online market, the still-free alternatives are available to absorb the 90 per cent of Times‘ visitors who’ve given up on the once dominant masthead.

As one of my colleague remarked though, Times readers (at least those who have been loyal to the brand) tend to be conservative and may not like the more lefty tone of the Guardian or Independent.

It would be interesting to know where they’re going. Is it to The Sun, The Express or The Telegraph, or are they going off-shore for their news fix.

The next set of data on traffic, downloads and unique visitors to other news sites will be interesting, particularly if there’s a spike somewhere that might correlate with Rupert’s deserters.

Rupert Murdoch could never be accused of stupidity. Rash behaviour at times, certainly, but he’s ruthlessly smart and totally focused on the bottom line.

In a few weeks time Murdoch’s most valuable (in terms of reputation and cache, if not profitability) media assets in the UK will disappear behind a paywall.

The Times and The Sunday Times will cost you real money from some time in June 2010. Already if you want to check-out the still free content you have to sign-up to go past the front page.

Next time you visit The Times, take a moment to register...have your credit card handy too.

Paywalls are controversial; supporters argue that without significant injection of subscriber funds there will be no more quality journalism, while detractors say that paywalls are anathema to the very ethos of the Internet.

“Perishable news – like that News Corporation is talking about, for instance – is ubiquitous,” she said. “The basic rules of marketing say people will substitute and not pay for what they can get free. Good luck to them, I really hope it works but all the norms of marketing say it won’t. [However] it is an experiment they can afford to make.” [guardian.co.uk]

Roy Greenslade also puts the strategy under the financial spotlight, pointing out that subscriber numbers would have to jump exponentially to cover the costs of the newspapers’ £100 million editorial budget:

If 100,000 people agreed to pay £2 a week for access to the papers, it would result in annual revenue of £10m. It’s a sobering thought that the sum is but a tenth of the papers’ editorial budget and less than an eighth of their current joint annual losses. [Greenslade blog] Read the rest of this entry »

You know what: we think it’s tough fending off the Wellydogs and Dribblejaws when it comes to National Radio. And there’s a certain element of truth in that.

But, take heart, we are not alone. If Ruper Murdoch’s News Corporation had a bigger presence in New Zealand, it could be a lot worse.

After a year or more of sniping, bitching, biting and barking, Uncle Rupe’s dogs of war have had a substantial victory in the UK.

The BBC – the paradigm example of public service broadcasting – has trimmed its own wings, rather than have them ripped off by a Tory government. According to a recent piece the The Guardian, the BBC has cut 600 million pounds from its expenditure and is reducing its online presence in response to whinging, money-grubbing complaints from commercial media (led by Murdoch) that the BBC was stifling its profit potential.

You know what, these free-market shysters should shove their own medicine where the sun-don’t-shine. They want to live an die by competition, yet when a service is popular and actually out competes them they bleat on about how it’s unfair that the BBC is so successful and has licence-fee money to spend.

The market is a failure and for the losers to whine and cry till they get their own way is pathetic.

Murdoch has now set his sights on the Australian Broadcasting Corporation. News Limited columnist Mark Day is spear-heading Murdoch’s down under, low and dirty under the table kneeing in the groin attacks on the ABC.

In a piece just yesterday [1 March] Day makes a direct link between the BBC’s pre-emptive self-kneecapping and what he thinks should happen to the ABC.

It is time we had a full debate about the role of the ABC. It was established in a vastly different media landscape as a taxpayer-funded entity designed to, in part, fill in the market niches not served by the commercial sector. Now, thanks to pay-TV and the digital revolution, those niches are hotly contested. [Day 1 March 2010 redefine ABC]

The man has no shame when it comes to doing Murdoch’s bidding and some people still wonder why we fight so hard for public broadcasting. This is a totally self-serving argument that ignores the reality and history of the market and clearly serves Murdoch’s interests.

So far the ABC is standing firm and Managing Director Mark Day Scott [tx Rob] has responded to the shot across the bows.

But it seems the vigorous pursuit of commercial agendas by some of our media rivals is allowing the facts to be sidelined in pursuit of a good story.

There is a concerted attempt to portray the ABC’s role in the media as solely that of a niche provider- participating only in sections of the market not served by the commercial sector.

This “market failure only” portrayal ignores the history: Australia has been richly served by a dual system of public broadcasting working alongside commercial media. [Not for sale]

Don’t lose sight of the fact that this is a global trend. The media industry is in trouble and public service broadcasters are actually doing OK. We tend to trust them more; they’re reliable; they’re staffed by people who care about good journalism; and they don’t have greedy shareholders sucking the life out of them.

Now the greedy slugs and layabouts want a slice of our pie too.

We need to tell them to “piss off” in no uncertain terms.

This is the fight we are now joining in terms of Radio New Zealand.Murdoch may not have any direct influence here, apart from Sky TV, but there are plenty of stalking horses in the commercial media. Whanganui’s mayor is an obvious early starter.

I have been tracking the various speeches by shady members of the Murdoch clan. You can read all about it on the following links:

The state broadcaster robs taxpayers of $38 million a year to, essentially, provide two radio options. The ironically named National Programme (when its politics is ostensibly liberal Labour) and the leech-like Concert Programme.

At a time when your radio dial is replete with choice – from Radio Rhema to The Rock – public policy has decided that two types of listeners require direct subsidy. Actually, three – but that is another scandal.